Understanding Informal Leaders in the Workplace and Why They are Important

Every workplace values leaders. Sometimes leadership can be in different ways. Leadership should be in supervision and management but that is not always the case. Workforce supervision does not always include leaders.

That brings us to informal leaders. What is an informal leader? According to the website businessdictionary.com, an informal leader is defined as, “An individual within an organization that is viewed as someone worth listening to due to their perceived experience and reputation among peers. The informal leader does not hold any position of formal authority or power over the peers choosing to follow their lead but can influence the decisions of others”. Important aspects of this definition are the words worth, perceived, influence.

Worth shows that the informal leader has value to the organization as well as value to his or her co-workers. Perceived or perception shows how the person is viewed within the organization. Lastly, influence shows that the person has the power of persuasion within the organization.

How do informal leaders compare with formal leaders within organizations? The most important person within an organization is the first line supervisor. These formal supervisors should be viewed as agents of change and be responsible for getting the organization’s mission and goals accomplished as delegated from the upper level supervisors.

Informal leaders assume a position within the chain of command without even realizing that they are taking on such a responsibility. The first line supervisor should be the official person responsible for day to day operations of the organization yet the informal leader may have more influence among their peers in this area.

Types of Informal Leaders

Next, what are specific examples of informal leaders within the workplace? Informal leaders come in both positive and negative forms. The following examples are not all-inclusive but can be within organizations.

1. Seasoned veteran employee.

This employee has been with the organization for a significant amount of time. They are well respected by their peers and supervisors. The veteran knows the job upside and down and from side to side. They produce results and know what works and what does not work. The veteran employee has had chances and opportunities to climb the ladder as a supervisor but chose not to do so because they enjoy the day to day work that they do. They may also not want the extra responsibilities of being a supervisor. The veteran employee is the “go to” employee within their group of peers when it comes to issues as they arise. This informal leader is the most important one of the group.

“Employers and business leaders need people who can think for themselves — who can take initiative and be the solution to problems.” — Stephen Covey.

Positive: Well rounded, experienced, “been there, done that”, has the best interest of the organization at heart.

Negative: Can be a threat to insecure first line supervisors or other informal leaders.

2. Younger employee looking to climb the ladder.

The next employee involves a novice or rookie employee trying to make a name for themselves within the organization. Typically, they are hard workers and set goals and work hard to achieve these goals. They are ambitious within the organization and see themselves as a “supervisor in training”. These employees are always looking for ways to develop influence and building a following among their peers. The younger or novice employee will look to immolate their first line supervisor and may develop positive or negative habits from this cloning. This employee will see the veteran employee informal leader as a threat. The novice informal leader employee should see the veteran employee as a positive resource.

“Successful business leaders who have helped build institutions of lasting value — all are committed to talent and a culture of excellence. This is usually accomplished by the identification, retention, and development of great people.” — Bobby Kotick.

Positive: Strong will to succeed, tendency to think outside the box, efficient.

Negative: May use shortcuts, may put ambition above organization.

3. Employee with prior experience as a supervisor in another organization.

This employee is a new or newer employee to the organization. The employee joined the organization at an entry level position after being a supervisor, manager, or administrator at a similar organization elsewhere. They have had formal supervisory experience and may or may not have enjoyed the role of being in charge. Either way they have experience calling the shots. They have a significant amount of experience in the business. Peer employees may see this employee as an informal leader due to their prior experience or the employee pushes the fact that they have prior supervisory experience from another organization. They may say, “Well we did it this way at . . . . . . “ or “If I was in charge we would . . . . . . “. Sometimes, this employee does not push their personal experience to other employees but will be available for help if requested or as needed.

“Business leaders cannot be bystanders.” — Howard Schultz.

Positive: Demonstrates experience, understanding of procedure, sharing of different points of view.

Negative: May cause conflict and lose credibility with “the way we did” perspective.

4. Employee with prior experience as a supervisor within the organization.

The next informal leader is the employee who has served in a supervisory position within the organization prior. This employee, for whatever reason, is no longer in that formal leadership position. The reasons could be that the employee took a step back for personal reasons such as needing more time with family. Another reason for the step backward could be a demotion due to performance. Peers within the organization may look to this employee as knowledgeable of the ins and outs of the organization.

“Many business leaders are seeing the relationship between long term success and sustainability, and that’s very heartening.” — Jacqueline Novogratz.

Positive: Well versed in organizational policy, procedure, and action. Experienced viewpoint.

Negative: Develops a negative image of the organization.

5. Appointed “next in charge” employee.

The appointed “next in charge” employee can also be an informal leader within the organization. This employee is the designated person in charge by the first line supervisor if the supervisor is absent. Sometimes this person is a good fit for the position and sometimes the person is the supervisor’s pet.

“The biggest part of my job now is to quickly develop successors, and around the world I am working to develop new business leaders in the company.” — Tadashi Yanai.

Positive: May be ready for this position and supported by their peers.

Negative: May be viewed by peers as a suck up to the brass.

6. Veteran employee going through “burnout” at work.

A veteran employee, even the above mentioned seasoned veteran employee, may be going through a burnout phase at work. Burnout can come at different times and last different lengths dependent on the individual employee. The organization should realize the difference in the veteran going through burnout and the seasoned veteran employee being productive. Junior employees may not understand the concept of burnout and look to this employee as an informal leader.

Occassionally, the opportunity for this employee to be utilized in an informal leadership position will allow the employee to work their way out of career burnout and move back into a positive mindset.

“The land of burnout is not a place I ever want to go back to.” — Arianna Huffington.

Positive: Experience within most aspects of the job. Knowledgeable of the organization.

Negative: May have negative opinion of the organization, supervisors, and the job itself.

Why are informal leaders important?

Informal leaders are important within any organization. It does not matter if the organization is in sales, manufacturing, technology, or public service. Organizational leaders can understand when to utilize the positive aspects of these informal leaders to maximize results. Also, organizational leaders can minimize the negative aspects of these informal leaders as well.

Each one of these informal leaders have a sphere of control with other peer employees. This fact is important for supervisors and administrators to understand. Some of these may a small sphere of influence and some may have a larger sphere of influence. In fact, some of these informal leaders may have larger spheres of influence than the first line supervisors or even the administrators.

A clearer understanding of this can be described as influence versus control. Supervisors can demand control of operations due to chain of command. Informal leaders can influence. A supervisor is a good leader when they understand that influence yields more productivity than does control. Well rounded leaders, whether supervisors or informal leaders, use influence in their actions.

Furthermore, a smart first line supervisor will understand the importance of influence as it relates to informal leaders. The organization must find the positive informal leaders and prepare them and give them further training in leadership.

“All this stuff doesn’t happen to you for your own sake. it doesn’t happen to you so you can fill your shelves with trophies or line your pockets with cash; it happens so you can have a positive influence and encourage other people.” — David Robinson.

An informal leader can aid an organization in a difficult change within the organization. A disgruntled informal leader can also sabotage the same change. Either way, an organization must understand that these informal leaders have a sphere of influence that traditional supervisors do not have — they are peers and that take up for the grunt workers and not viewed as brass.

Informal leaders are a resource that corporations and administrators sometimes fail to recognize. The more a group knows about the dynamics of informal leadership and examples of who they are within their organization will yield better productivity. All organizations want to have positive productivity whether they are making car parts, selling insurance, or providing security.